When your retirement is a long way off, it can be challenging to think about pension plans. Even though you have contributed to the scheme for many years, pensions can prove challenging to keep track of.
Indeed, it is common for people to forget old or misplaced pensions. Currently, around £19.5 billion of pension funds remain unclaimed.1 This money rightfully belongs to someone, and that someone could be you.
This article aims to inform you how to relocate old or misplaced pensions and what to do when you have found them. Planning for your long term future is crucial; when considering your pension, take on expert advice from a specialist such as Portafina.
Why are so many pensions unclaimed?
People losing, misplacing, or forgetting about their pensions has led to almost 1,600,000 pension pots remaining unclaimed. These parts have a combined worth of £19.4 billion, which equals virtually £13,000 per pension.
You might think this figure is staggering, and you would be right. Therefore, let’s look at why so many pensions remain unclaimed.
- Moving home.
Moving home has a significant role in why so many pensions go unclaimed. In the mayhem of moving home, informing your pension provider of your new address is easy to forget.
Indeed, a study conducted by ABI showed that only 4% of people remember to inform their pension provider about their address change1 . If you are one of the people who do not, you may have some money in the unclaimed pension pot.
You should receive an annual statement about your pension. However, if it is going to another address, you could easily forget about your pension over time.
- Moving jobs.
If you move from one job to another, your workplace pension scheme will also change. When you stop paying into one scheme, it is easy to lose track of it.
Tracing lost or misplaced pensions.
If you have not kept track of your pensions, the schemes may have closed, been renamed, or merged. All of these will make it more challenging to trace your pension.
Start by gathering all the paperwork you can find about your pension and former employment. If you’ve moved address and still have your pension provider’s details, you can contact them and inform them of your new location. You couldn’t get details sent out about your pension plan.
You need to provide some details about your pension. Once your provider has located it, they can give details, including the following:
- Its current value.
- Potential retirement income.
- Amount paid into the pension.
If it is a workplace pension you have lost or misplaced, your first point of contact should be your former employer. They should be able to provide you with details about the workplace pension you were in.
Other ways to locate your lost pensions.
If you do not have time to locate your lost pensions, or it is proving too challenging, you can ask a financial advisor to assist you. They can guide you through the process or find your pensions for you.
Once you find your pension, a financial advisor can analyse it to ensure you are making the best financial decision. Using a financial advisor can have a positive impact on your retirement funds.
Another way to locate your pension provider is to look at previous payslips and old bank statements. You should see regular payments being made to a pension company.
The Pension Protection Fund often takes over pension plans. This makes them challenging to locate as they may not be under the original name. Your pension fund might have been taken over if your employer could not pay the benefits it promised.
You’ve located your pension; what next?
Locating a lost or misplaced pension is excellent, as it will put you in a better position financially for retirement. However, what should you do now?
A good start is to transfer your old pensions into your current plan. Doing so will cut down on the administration and make them easier to keep track of. You might also want to consider other pension plans or other providers. These may provide you with better performance or lower charges. Both of these will give your pension a better chance to grow.
When it comes to pensions, size matters.
How comfortable your retirement will be can come down to the size of your pension pot. Therefore, you want to ensure that it is as large as possible. If you have money sitting in an unclaimed pension, as millions of people do, those funds will not be contributing to your retirement. Hopefully, this article will help you to relocate any last pension plans. If you need any additional help, you can always consult with a regulated financial advisor.